Following SBC’s announcement last week that it has expedited the build out of its fiber access network in light of new regulatory developments, the telco today revealed it has awarded Alcatel a $1.7 billion, five-year deal for equipment and services related to the telco’s Project Lightspeed initiative.
Through Project Lightspeed , SBC will deliver integrated IP television, ultra-high-speed, broadband services, IP voice and wireless bundles of products to 18 million households by the end of 2007, the company announced last week.
The agreement announced today identifies Alcatel as SBC's primary supplier of network infrastructure including access and fiber technologies, IP routing and Ethernet switching solutions, and network systems integration services – including offering integration services for SBC’s future facilities-based video services.
That’s in addition to SBC’s existing deal with Alcatel for passive fiber-to-the-user equipment. SBC last December announced a four-year agreement with Alcatel for the FTTU equipment, but declined to provide financial details of that deal.
As part of this new deal, Alcatel will provide SBC with its remote 7330 IP DSLAM solution, which supports multiple variations of DSL for SBC's fiber to the neighborhood node architecture. SBC will also use Alcatel's 7750 Service Router and 7450 Ethernet Services Switch to offer differentiated IP-based services, such as video.
Alcatel in the past couple years has snapped up several companies to position the company to deliver IP services -- including video -- over networks based on its popular DSL equipment, says Mike Quigley, president of Alcatel North America. For example, Alcatel in July of 2003 acquired TiMetra Networks, a provider of IP/MPLS service routers for the network edge. In November of 2003, Alcatel acquired the network solutions unit of PacketVideo, bringing video server technology for the mobile communications into the Alcatel fold. And in February of last year Alcatel announced plans to buy iMagicTV, a company offering software to handle the creation, delivery and manage of digital TV and rich media service over broadband networks.
The fact that Alcatel has its own video services middleware raises the question of whether that Alcatel video solution is now a significant challenger to Microsft, which is providing its IPTV middleware to SBC as part of a trial announced at SUPERCOMM this summer. Microsoft and SBC were unavailable for comment on the issue this afternoon. And Alcatel’s Quigley responded that “Clearly as part of the evaluation overall we used a number of different middleware components and demonstrated we could work with multiple middleware solutions and Microsoft was one of them.”
SBC plans to do a field trial of video -- that will employ the Microsoft IPTV software --over its fiber access facilities in the first quarter of 2005, with a commercial rollout of video expected to begin in the third or fourth quarter of next year. Chris Rice, SBC’s executive vice president of services and CTO, at last week’s TELECOM ’04 show told XCHANGE that SBC will do a trial offering 100 to 1,000 homes a single video stream over an SBC fiber-to-the-premises or fiber-to-the-node network. Rice declined to provide specifics of locations or number of targeted households for SBC’s expected IPTV commercial rollout to begin in mid- to late-2005. He added the commercial rollout will be predicated upon the readiness of Microsoft’s IPTV platform.
Ed Graczyk, director of marketing and communications for the Microsoft TV Division at Microsoft Corp., earlier this week told XCHANGE that his company expects to have its IPTV solution ready to go commercial in scale by the second half of 2005.
Microsoft’s IPTV platform includes end-to-end software that handles video from the point the content is “ingested” by the network from a satellite head-end or other source, can do the coding and encoding of that content, distribute it and display the programming on the TV set, explains Graczyk.
In addition to SBC, Bell Canada, Reliance Infocomm Ltd. (of India), Swisscom/Bluewin and Telecom Italia are also involved in the Microsoft IPTV “early adopter program,” for which carries have to make “a seven-figure” investment to participate, says Graczyk. Through that program, says Graczyk, Microsoft provides service providers with the software, servers, set-tops, training, integration and other professional services for a lab trial, a “friendly” trial and then consumer trials involving up to 1,000 homes. Those service providers can then decide whether to move forward with larger commercial deployments, which of course would entail a new licensing contract with Microsoft.
